The system of labor indicators in the development of a business plan

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Sergei has his own production workshop - he makes custom-made furniture. The order of work is as follows: a client orders furniture, makes an advance payment and Sergey starts work. The lion's share of the prepayment is taken by materials that need to be ordered and bought, workshop rent, employee salaries, utilities. But Sergey is not worried - although he does not have his own funds, but there is a queue of clients for three months in advance, and most of the prepayment has already been received.

It would seem that the business is successful. But no. Sergei does not live on his own money. He uses other people's money, that is, he lives in debt. To assess the effectiveness of his business, he uses the indicators "Income" and "Expenses" and believes that this is enough. But if he continues to work according to this scheme, then at best the business will stagnate, at worst - it will go bankrupt. And when this happens, Sergei sadly exclaims: "Well, what did I do wrong ?!" and go out of business.

Thousands of businesses are closed every year. In 2021 alone, 346,995 enterprises ceased to exist. Since the beginning of 2021 - 26970. In terms of operating businesses, Russia fell back to the level of 2021.

Small business statistics data from the FTS website

Bankruptcy of enterprises occurs for various reasons. Sometimes because an entrepreneur does not know how to correctly assess profitability and efficiency of work, which means that he does not have time to predict the fall of the business and take measures to improve it (like our hero Sergey). We will tell you what indicators need to be assessed in order not to join the ranks of bankrupts.

What are performance indicators

If a company has millions of dollars in its accounts, this does not mean that it is in the black. Just like a cash gap or a negative account balance, it is not a fact that a business is on the verge of bankruptcy. Whether the business is successful or not shows not the amount of money in the cash register, but the numbers on various aspects of the company. These numbers are performance indicators.

Business plan structure performance indicators

Many modern economists and entrepreneurs often ask questions about the concept of business efficiency. The topic is quite difficult due to its specificity. It is very important to define the very concept of efficiency. In simple terms, we will talk about a qualitative or positive result in the process of any activity. This statement is partly true.

However, such questions require more in-depth research on the topic, because the assessment of business performance should include not only a verbal description of the activity, but also various generally accepted economic and mathematical formulas. Let's try to figure it out.

Efficiency

The economic meaning of this term is characterized as the ratio of the funds spent to the achieved result. In other words, it is the result divided by the cost.

Let's try to give an example: the company is engaged in the processing of metal products. 100 parts were processed. The final cost of one part is 2 rubles. The cost of one part, taking into account the processing process, is 1 ruble. It turns out that the efficiency of this production will be equal to 1.

This is the most trivial of the examples. The fact is that in modern business, efficiency is not only and not always understood as indicators.

This can be the number of sales, and the profitability, or even the number of products released. Such an assessment requires a rather narrow approach.

Each industry can have its own business performance indicators, which practically does not allow you to give a specific definition of this concept.

If we go back to the examples and take an IT company, then its effectiveness can be easily assessed by its audience reach or by the number of users. If we consider a marketing agency, then there may be several indicators, for example, audience coverage, the effectiveness of events.

There is an opinion that the efficiency of a business is its stable and smooth functioning without any problems.

Evaluation

Key performance indicators (KPIs) are a whole system of assessment that helps an organization determine the achievement of strategic and tactical goals. Their use gives the organization the opportunity to assess its condition and to help assess the implementation of the strategy.

Business project performance indicators are:

  • Profit
  • Profitability
  • Break-even point
  • Financial strength
  • Payback period - PBP,
  • Accepted discount rate -D
  • Discounted payback period- DPBP
  • Net present value- NPV
  • Internal rate of return- IRR
  • Term of repayment of borrowed funds - RP
  • Coverage ratio of outstanding loans (repayment of borrowed funds)

The main indicator of the efficiency of any enterprise is profit, as the most important indicator of the organization's activities.

The next indicator that characterizes the efficiency of an enterprise is profitability.

Profitability means profitability, profitability of an enterprise.

Profitability is the result of the manufacturing process.

The main indicators of profitability are:

1). Product and sales profitability

2). Enterprise ROI

4). Production profitability

It is formed under the influence of factors related to:

At a certain stage of development, an entrepreneur seeks to assess the effectiveness of his company. It is this assessment that allows us to conclude to what extent the organization follows the predicted development scenario, after which a new business strategy is built. Business efficiency reflects the success of the company, the compliance of its normative quantitative indicators inherent in specific stages of activity. This article will cover the following points on this topic:

Business Performance Assessment

Thanks to the assessment of business performance, you can get data on how the company is developing, whether the business plan is working. As a result, the main document of the enterprise is corrected, and a new, more effective one is created. The main indicators that determine the assessment of business performance:

  • Updating, replenishing the range of goods / services. In the financial plan, the company should provide for spending on the order / purchase of new products that would be of interest to the consumer;
  • A moderate percentage of defective products. This indicator is applicable to goods (made of poor quality in production) or services (provided in an inadequate quality). The lower the scrap percentage, the more profit;
  • Increase in customer loyalty rates. More than 30% of regular customers are evidence of the company's successful work;
  • Effective management. Thanks to the well-established work of management, the level of income can increase several times over the year, exceeding the costs;
  • Market share. The indicator characterizes the position of the firm in the market compared to competitors. A quantitative marker of market share is determined by the% ratio of sales volume indicators to the total sales of goods of a similar category in the market.

The specified business performance indicators can provide information about only one business process. By systematizing the indicators, it will be possible to find out the overall business performance of the company. Each company independently chooses the parameters of business efficiency.

Financial indicators of business performance:

  • Find a key indicator - a financial marker, due to which conclusions about efficiency are drawn. For example, in the real estate rental business, this is the level of profit per square meter, in the business of providing mobile services, this is the company's average monthly revenue per subscriber;
  • Price formation.

Key performance indicators (Key Performance Indicators, abbr. KPI) - tools that allow you to analyze the effectiveness of any activity, to determine the percentage of achievement of goals. KPIs in any area of ​​business are:

  • Business turnover;
  • Net asset value;
  • Aggregate market share;
  • Income before deductions; <
  • Net profit;
  • Net present value of the business;
  • Index of business development potential;
  • Debt load of the business;
  • Efficiency per employee.

Basically, business performance is assessed based on financial statements. Documentation allows you to determine the financial position of the company, the results of its activities. Based on this information, one can draw conclusions and make key economic resolutions.

Key factors for assessing business performance, video:

Increasing business efficiency

Modern economic conditions stimulate entrepreneurs to reduce costs, simplify business processes and improve business efficiency, with an increase in its profitability. But how can all these tasks be realized? To do this, you need to use tools that will increase the efficiency of your business.

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  • INTRODUCTION 3
  • CHAPTER 1. MAIN OBJECTIVES OF BUSINESS PLANNING IN THE ENTERPRISE 5
  • 1. ... Business Planning Trees and Functions 5
  • 1. ... Business plan structure 10
  • 1. Performance Indicators 15
  • in developing a business plan 15
  • CHAPTER 2. PERFORMANCE DEVELOPMENT 17
  • 2. ... Company profile 17
  • 2. ... Payroll calculation for 2021 22
  • 2. ... bonus system 28
  • 2. ... Non-financial incentives. 32
  • CONCLUSION 34
  • REFERENCES 36

Planning is an indispensable element of any business activity. It is impossible to achieve stable business success without a clear understanding of the goals of your activities, constant collection and analysis of information about the state of sales markets, the position of competitors, and about your own prospects and opportunities. First of all, the success of any business depends on how well the business sector is chosen, the market situation is correctly assessed, the strategy is chosen and the tactics for its implementation are developed.

It would not be an exaggeration to name a business plan as the basis for managing not only a commercial project, but also the enterprise itself. The business plan acts as an objective assessment of the company's own entrepreneurial activity and at the same time as a necessary tool for design and investment decisions in accordance with the needs of the market. This is simultaneously search, research and design work. The business plan provides for the solution of strategic and tactical tasks facing the enterprise, regardless of its functional orientation:

organizational, managerial and financial and economic assessment of the state of the enterprise;

identifying potential business opportunities, analyzing strengths and weaknesses;

planning the social development of the team;

formation of investment goals for the planned period.

The business plan substantiates general and specific details of the enterprise's functioning in market conditions; choice of strategy and tactics of competition; assessment of financial, material, labor resources necessary to achieve the goals of the enterprise.

Business planning is a tool to enhance the implementation of ideas and projects of any type. Any complex problem can be divided into simpler ones, then detailed and considered the probability of their implementation. This method is at the heart of business planning. The business plan gives an objective idea of ​​the possibilities for the development of production, and the social development of the team, methods of promoting goods on the market, prices, possible profit, the main financial and economic results of the enterprise, identifies risk zones, suggests ways to reduce them. The business plan addresses both internal tasks related to enterprise management and external ones, due to the mutual consideration of the interests of all parties involved: the customer of the business plan, contracting firms, municipal authorities, and, finally, the consumer.

The purpose of this work is to develop a direction for the socio-economic development of the team as part of a business plan.

In the transition to a market economy, mastering the art of drawing up a business plan becomes extremely relevant. This is due to a number of reasons. First, the changing economic environment puts managers (both experienced and beginners) in front of the need to calculate their actions in the market in a different way, to prepare for such a continuous occupation for them as fighting competitors. Secondly, a new generation of entrepreneurs is entering our economy. Many of them have no experience in managing an enterprise. Therefore, they are very vague about the practical problems. Thirdly, modern investment projects, as a rule, require large investments. They are not always available to entrepreneurs. In this regard, managers must be able to substantiate their applications and prove (on the basis of documentation adopted in the West) that they are capable of assessing the main aspects of the use of investments no worse than businessmen from other countries.

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